The Egyptian General Petroleum Corporation (EGPC) has called the National Bank of Egypt (NBE) in order to boost the issued letters of credit to import Kuwaiti crude oil with $1billion instead of $1.5 billion during the current time.
An official source in NBE said his bank has initially approved to increase the issued letters of credit in favor of EGPC so as to provide its needs from Kuwaiti crude oil with $1billion instead of $1.5 billion, to boost the shipments from 1.5 to 2 million barrels per month to provide a deficit caused by the cancel of Libyan transaction.
The source added to Amwal Al Ghad that many negotiations have been conducted between the officials of the NBE and EGPC during the last period in order to study the recent developments of Libyan transaction valued at $ 1 billion as result of the turmoil situation in Libya.
Amwal Al Ghad has published the details of the meeting which ended by halting the transaction of importing the Libyan oil which has been signed in the last May with $1 billion, after NBE has issued the first letters of Credit to receive the first shipment with $77 million.
Due to insecurity situation which experienced by the Libyan state, and many oil ports stopped to supply state-of-production fell by 1.5 million barrels per day to between 100 – 300 K barrels per day, and the value of losses up to $ 130 million a day, according to state officials.
Kuwait Petroleum Corporation (KPC) agreed in the last of September to increase the qualities of crude oils in the Egyptian refineries from 1.5 million per month to two million barrels.
KPC has renewed the agreement with Egypt, including two parties the first is supplying the crude oil and the second is supplying Diesel , the agreement allows for EGPC to obtain Facilities in paying up 9 months without paying any interest or additional fees.
NBE is considered to be the first funded for EGPC among the banking sector banks as the issued letters of credit reached around $7.7 billion within the last fiscal year for import and $360 million for the export, NBE has further approved in the last week to renew the annual letters of credit in favor of EGPC worth EGP 30 billion within the current fiscal year of 13/14.
The total funding to the NBE for the oil sector reached about EGP 41 billion by the end of the last fiscal year 12-2013.